Medicare Rx card plan faces legal hurdle

Pharmacists, chain pharmacies challenge Bush's discount drug program in court; meanwhile, Tommy Thompson tries to drum up congressional support.

By Tanya Albert, AMNews staff. Aug. 6, 2001.

President Bush's prescription drug discount card program must overcome a legal battle before seniors could receive "Medicare Rx" cards this fall.

The National Assn. of Chain Drug Stores and the National Community Pharmacists Assn. sued the Dept. of Health and Human Services and the Centers for Medicare & Medicaid Services in July, seeking an injunction to stop the program's implementation.

HHS and CMS don't have the legislative authority to create the program, and the government violated federal law by secretly meeting with private companies to create it, the groups charge in the lawsuit filed in U.S. District Court for the District of Columbia.

"Medicare can't do this," said John M. Rector, NCPA general counsel. "They have to go through Congress. Anytime they want to involve the private sector, there has to be debate."

NACDS and NCPA said that didn't happen before Bush announced the prescription drug card proposal.

The plan -- part of an outline of broad principles Bush wants to see in Medicare reform legislation -- calls for seniors to get some immediate breaks on prescription drug prices while Congress works on comprehensive reform.

Pharmacy benefit management firms would issue government-approved "Medicare Rx" cards that seniors could begin using in January 2002. The managers would use the combined purchasing power to negotiate discounts with manufacturers and pharmacies to generate savings. Five of the nation's largest PBMs already have agreed to participate.

The plan's supporters, including the AMA, say it would be a tangible benefit for seniors that could be put in place quickly. [...]